VB vs VTBNX
Vanguard Small Cap ETF vs Vanguard Total Bond Market II Index Fund Institutional Shares
Quick Verdict
VTBNX has a lower expense ratio. VB delivered stronger 1-year returns. VTBNX offers more diversification with 8098 holdings.
Side-by-Side Comparison
| Metric | VB | VTBNX | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.02% | |
| AUM | $81.5B | $206.7B | |
| Dividend Yield | 1.48% | 3.73% | |
| Holdings | 1,324 | 15,623 | |
| YTD Return | +17.82% | -2.29% | |
| 1Y Return | +29.09% | -1.67% | |
| 3Y Return (annualized) | +16.24% | +0.18% | |
| 5Y Return (annualized) | +8.18% | -3.45% | |
| Volatility (annualized) | 18.9% | 6.3% | |
| Max Drawdown | -61.0% | -21.5% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Jan 26, 2004 | Feb 17, 2009 |
VB vs VTBNX Performance
Vanguard Small Cap ETF (VB) is a ETF from Vanguard (US) and Vanguard Total Bond Market II Index Fund Institutional Shares (VTBNX) is a mutual fund from Vanguard (US). Over the past year VB returned +29.09% while VTBNX returned -1.67%. Year to date, VB is up 17.82% versus a loss of 2.29% for VTBNX.
Over three years, VB compounded at +16.24% per year against +0.18% for VTBNX; over five years the annualized figures are +8.18% and -3.45% respectively. Across the full 5-year window we track, VB has the edge at +8.86% annualized vs -3.45%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VB has been the more volatile fund, with annualized monthly volatility of 18.9% compared with 6.3% for VTBNX. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -61.0% for VB and -21.5% for VTBNX. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.60. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VB charges 0.03% per year while VTBNX charges 0.02%. On a $10,000 position that is $3 vs $2 annually, a gap of $1 per year that compounds over a long holding period. On income, VB currently yields 1.48% against 3.73% for VTBNX.
Holdings Overlap
VB and VTBNX share 3 holdings out of 9207 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VB or VTBNX?
VB has an expense ratio of 0.03% while VTBNX charges 0.02%. VTBNX is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, VB or VTBNX?
Over the past year VB returned +29.09% vs -1.67% for VTBNX, so VB leads on 1-year performance. Over the longest common window we track (5 years), VB annualized +8.86% vs -3.45% for VTBNX. Past performance does not guarantee future results.
Which is riskier, VB or VTBNX?
VB has been the more volatile fund at 18.9% annualized versus 6.3% for VTBNX. Worst drawdown: VB -61.0% vs VTBNX -21.5%.
Should I hold both VB and VTBNX?
VB and VTBNX have a monthly-return correlation of 0.60, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VB and VTBNX?
VB and VTBNX share 3 common holdings with a 0.0% weight overlap. Combined, they hold 9207 unique securities.
Which pays a higher dividend, VB or VTBNX?
VB yields 1.48% while VTBNX yields 3.73%, so VTBNX currently pays the higher dividend yield.
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